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TMA Wants Stronger Grace Period Notification

The Centers for Medicare & Medicaid Services (CMS) should require insurers who offer health plans on the Affordable Care Act exchanges to provide immediate notice when patients enter the first month of the 90-day grace period. That's what the Texas Medical Association, the American Medical Association, and more than 80 state medical societies and specialty organizations told CMS Administrator Marilyn Tavenner in a letter.

The groups have asked CMS to revisit its policy that allows plans to pend and deny claims for months two and three of the 90-day grace period, which begins when patients fail to make a premium payment for a subsidized ACA marketplace plan. "We further urge CMS to strengthen the requirements for how and when issuers notify physicians and other providers that a patient who has purchased subsidized … health insurance coverage has entered the 90-day grace period for nonpayment of premiums," the letter states.

Physicians have voiced concern over federal rules that put them at risk of health plans' clawing back any payments made in the second or third month of the grace period when patients are delinquent on premium payments.

Under ACA, marketplace regulations give patients with subsidized health insurance coverage three months to pay their premiums and allow health plans to deny or later recoup payments from doctors for services provided to patients who are delinquent. The patients must have paid at least their first month's premium to be eligible for that 90-day grace period.

Federal regulations require exchange plans to notify affected physicians "as soon as is practicable when an enrollee enters the grace period, since the risk and burden are greatest on the provider." Notification includes where the enrollee is in the grace period and the names of everyone covered by the policy. The notice must tell doctors the health plan may ultimately deny payment. But federal rules don't specify when or how insurers have to send the notification.

TMA and other organizations call the notice requirements "inadequate" and say they'll "lead to administrative confusion for physicians and practices." The groups "urge CMS to require issuers to notify providers of a patient's grace period status as part of the insurance eligibility verification process."

"CMS has unfairly shifted the burden and risk of potential loss for patient non-payment of premiums to physicians," the letter states. "This financial burden will be untenable for many physicians."

AMA plans to develop tools to help physicians navigate the complexities of the ACA grace period.